COMMISSIONER OF INCOME TAX Vs. GIRNAR CONSTRUCTION COMPANY

JUDGEMENT

(1.) THE appeal was admitted in terms of the following questions :

(2.) THE assessment year involved is 1990-91. THE assessee is a registered firm, deriving its income from building trucks/dumpers on hire/rental basis. THE assessee-firm has filed its return on August 27,1990. According to the Assessing Officer the books of account are not supported by bills and vouchers and even salary has been paid to close relations/which is hit by the provisions of Section 40A(2)(b) of the Act. Question No. 1 relates that was disallowed by the Assessing Officer, therefore, the salary paid to Shri Sumati Kumar and Padam Kumar, i.e., their relatives and the salary paid to them is unreasonable. THE finding of the Tribunal is that the salary has been paid for work which Shri Sumati and Shri Padam Kumar have done for the assessee. Though they are relatives Rs. 1,000 per month to a person for the work they have done in our view cannot be said to be unreasonable. Otherwise, also that finding of fact of the Tribunal that salary paid to Sumati and Padam Kumar is for the purpose of business and accounted for it cannot be said unreasonable in the facts and circumstances of the case.